Does My Employer Have To Offer Health Insurance?

In 2010, the Affordable Care Act (ACA), also referred to as “Obamacare”, was signed into law. To put it bluntly, the law is controversial and polarizing, and politicians across the country have been elected to office by riding the currents of anti-ACA sentiment.

Despite this, no one can dispute that health insurance is important. Having health insurance when we truly need it saves us from certain financial ruin. It also protects our families and gives us some peace of mind that when a medical need arises, we can rely on receiving medical care. Regardless of whether you love or hate the ACA, it is the law of the land and it is important to understand what it means to you, as an employee in California.

If Your Employer Has Less Than 50 Employees

If you work for an employer who employs 50 full time employees or “full time equivalent” (FTE) employees, your employer is not mandated to provide you with health insurance under the ACA. However, your employer always has the option of offering you a partially covered “Small Business Health Options Plan” (SHOP), which provides your employer with a tax credit.

The Employer Mandate

In contrast, if you work for an employer with fifty or more full time employees or FTE employees, then your employer is required to provide you with “affordable minimal essential” health insurance coverage. This is because employers of this size qualify as “Applicable Large Employers” (ALE) under the ACA. This insurance coverage must:

1. Meet the Minimum Essential Coverage (MEC) requirements. According to the ACA Website, plans that may meet the MEC requirements include plans offered in the ACA marketplace, employer-based plans, Medicare, and Medicaid/CHIP. Plans should provide a minimum coverage of 60% of the costs of covered health services.
2. Be affordable. An employee’s health insurance premium must be less than 9.66% of his or her annual household income.

Significantly, if an ALE fails to offer you this health insurance coverage, it will become liable for Employer Shared Responsibility Provisions, also known as an employer mandate. These are penalties that must be paid to the IRS for each month and for each inadequately-covered employee due to ACA non-compliance.

Contact Moss Bollinger

If you work for an employer that employs more than 50 full time employees, but are not being offered health insurance, you should consult with an attorney. Although controversial, ACA compliance is the law and employers must comply. At Moss Bollinger, we understand your legal rights and want to help you. We charge no fees up front and only get paid if you do. Call us today at (310) 982-2291 for a free consultation or complete our online form.